Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.
As a business owner, building your own commercial space can be especially rewarding. You'll be able to design a unique building that will strongly appeal to your future client base, whether they're customers, clients, or tenants.
A custom build can be a major factor in differentiating you and your business from the competition. Building on land you've chosen can also be equally important for you and any financial backer's satisfaction, together with the business' success.
No matter how stunning your business may appear on paper, it's imperative that it's in an ideal location. While your main goal is for your business to be easily accessible by potential clients or customers, you'll control costs if your location already has access to utilities like electricity and water.
The value of preparation is familiar to experienced business owners. A higher return on investment (ROI) and a trouble-free building procedure are rewards for thorough planning and execution during the land acquisition and development phase.
Before you take the first step towards acquiring and developing land, your business plan should include the tasks required for a successful build, from site selection to project management.
Let's start from the ground up and look at the factors involved in locating the ideal location.
When choosing a site for your commercial development, several factors must be considered before you begin your search.
Each of the following should be included in your preliminary plans.
Ensure that the land is zoned for your intended use. Zoning laws dictate the types of businesses and structures allowed in specific areas.
Applying for a change in zoning may be possible, but this doesn't mean it won't be a lengthy and perhaps expensive process.
Since zoning laws are typically controlled at the local level, check with your department of city planning or similar office to learn about the laws and codes that apply to your preferred area.
Generally, land is zoned for residential, commercial, or a mixture of both. This is usually described as “mixed-use.”
When compiling a shortlist of potential land sites for acquisition, be sure that each one offers access to mandatory building utilities such as water, electricity, and sewage.
While you may find a bargain-priced plot of land for your business that's off the beaten path (without utility access), the cost of extending utilities to your site can significantly impact your budget.
Be sure to obtain accurate estimates for each utility before proceeding with this type of acquisition.
Select a location that will provide your future clients, customers, and/or tenants with easy, convenient access. Depending on the type of business planned, you may want to seek land near other businesses that complement your own.
Be prepared to review demographic data for the land you plan to acquire, comparing data if you're considering several plots of land or areas.
Depending on the type of business planned, you may need to access demographics of local populations that include details of income, education and other factors that correspond with your business.
For example, if you're building a car wash, data with details of local families' size, vehicles, drivers, and income are important.
After you complete these tasks, you'll be closer to your land purchase. Now it's time to conduct due diligence, as it will ensure the smooth development of your new commercial project after you complete land acquisition.
Before committing to a purchase, it's crucial to conduct thorough due diligence on the property.
The following steps should be followed:
After you've completed your research, be sure to review your financing options, as these can change overnight.
Depending on size, location, and other factors, you may have more than one of these options available to you.
Ready to break ground on your new property? Here are tips on managing the development of the land itself and the construction of your project.
Once you've secured the land and financing, it's time to author a plan for managing the development process. This will most certainly include, but not be limited to:
If this is your first land acquisition and development project, you may want to bring in one or more consultants.
They can ensure your commercial building project is always in compliance with local regulations and help you spot problems before they occur.
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